Janet Yellen's appointment is a triumph for feminism and for progressives

Unlike her monetarist predecessors, the first female chair of the Federal Reserve puts tackling unemployment on an equal footing with fighting inflation.

There seems to be a consensus that this has been a good and bad year for feminism. Well sisters, listen up, because it’s time to celebrate.  According to a Radio 4 profile by Mary Anne Sieghart, a woman is now the first or second most powerful person in the world (depending on the relative power you attribute to Angela Merkel). And the Atlantic has described her as the most powerful woman in American history.  

How’s that for progress? Let’s all raise a glass in congratulations to Janet Yellen, the first female chair of the US Federal Reserve. We should be clear: this is a major break-through. No woman in history has ever chaired any of the world’s leading domestic financial institutions. The Bank of England, the European Central Bank, the Bundesbank, the Fed: all men, for all of history. When her term begins in February, against that backdrop, there will be Janet.

Whatever your economic standpoint about the role of central bankers in the microeconomic challenges we all face – paying for the shopping, affording next year’s holiday – surely it matters that there is one less hallowed, powerful, lofty position for which women are yet to be deemed qualified? So what might we expect from the Fed’s new chair?

Yellen hails from an economic tradition that sees the economist’s role as deeply connected to the concerns of ordinary individuals, having gained her PhD with James Tobin at Yale. As President Obama said yesterday, "The American people will have a fierce champion who understands that the ultimate goal of economic and financial policymaking is to improve the lives, jobs and standard of living of American workers and their families."

The current incumbent, Ben Bernanke, is a monetarist, building on the foundations of Milton Friedman and Anna Schwartz. They see the role of government in the economy being to appropriately control the money supply to provide price stability. Inflation is the target, no matter what the impact on individuals within the economy.   

In contrast, Yellen is certainly a progressive. She chaired Bill Clinton’s Council of Economic Advisers late in his term of office. Her critics from the left might argue that Wall Street’s apparent ease and, in some quarters, enthusiasm for Yellen’s appointment does not augur well for a tougher approach to regulation, though this probably stems as much from Yellen being a known actor already within the Fed, as opposed to a Fed outsider choice such as Larry Summers. But as we’ve seen with George Osborne’s approach to financial services regulation, and his defence of the bonus culture, the battle for a well-regulated global financial services industry is far from won.

As a highly distinguished labour market economist, Yellen authored work on the interplay between wage rates, unemployment, and what we might now term underemployment. Of course, this is now a major challenge in the US and European economies. At the Fed itself, she has been successful in placing unemployment on an equal footing with fighting inflation as a macro-economic target. And according to Time magazine, she’s a numbers person, setting high regard for evidence over orthodoxy. And when the orthodoxy has so conclusively failed, surely change is a good thing.  

Alison McGovern is Labour MP for Wirral South, shadow minister for international development, and studied economics at Birkbeck College

Janet Yellen testifies during her confirmation hearing November 14, 2013 on Capitol Hill in Washington, DC. Photograph: Getty Images.

Alison McGovern is Labour MP for Wirral South.

Getty Images.
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Donald Trump's healthcare failure could be to his advantage

The appearance of weakness is less electorally damaging than actually removing healthcare from millions of people.

Good morning. Is it all over for Donald Trump? His approval ratings have cratered to below 40%. Now his attempt to dismantle Barack Obama's healthcare reforms have hit serious resistance from within the Republican Party, adding to the failures and retreats of his early days in office.

The problem for the GOP is that their opposition to Obamacare had more to do with the word "Obama" than the word "care". The previous President opted for a right-wing solution to the problem of the uninsured in a doomed attempt to secure bipartisan support for his healthcare reform. The politician with the biggest impact on the structures of the Affordable Care Act is Mitt Romney.

But now that the Republicans control all three branches of government they are left in a situation where they have no alternative to Obamacare that wouldn't either a) shred conservative orthodoxies on healthcare or b) create numerous and angry losers in their constituencies. The difficulties for Trump's proposal is that it does a bit of both.

Now the man who ran on his ability to cut a deal has been forced to make a take it or leave plea to Republicans in the House of Representatives: vote for this plan or say goodbye to any chance of repealing Obamacare.

But that's probably good news for Trump. The appearance of weakness and failure is less electorally damaging than actually succeeding in removing healthcare from millions of people, including people who voted for Trump.

Trump won his first term because his own negatives as a candidate weren't quite enough to drag him down on a night when he underperformed Republican candidates across the country. The historical trends all make it hard for a first-term incumbent to lose. So far, Trump's administration is largely being frustrated by the Republican establishment though he is succeeding in leveraging the Presidency for the benefit of his business empire.

But it may be that in the failure to get anything done he succeeds in once again riding Republican coattails to victory in 2020.

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.